Residents talk Ballot Measure 1

More than 25 people showed up for Tuesday’s “Ballot Measure No. 1: Referendum to Repeal SB 21” dialogue held at the Homer Public Library. It was booked as an open discussion with all viewpoints welcome.

That was disappointing for Rebekah Jones. Having heard lots of “vote no” and few “vote yes” ads, Jones wanted information to help her decide how to vote on the ballot measure in August.

“I have my own political persuasions, which gives me a gut feeling, but I don’t want to vote on my gut when I don’t have the facts,” she said. “I want to be more logical in my approach.”

Andy Haas said he was looking for “impartial facts.”

“What would put me on one side of the fence or the other is a really independent financial analysis and I haven’t heard one yet,” said Haas.

Describing the evening as “the choir speaking to each other,” James Dolma said he had hoped “to hear at least some intelligent attempt to change my mind.”

Tuesday’s discussion about the ballot measure to repeal Alaska’s oil and gas tax structure, as set forth in Senate Bill 21 and passed by the Legislature in 2013, was sponsored by “Let’s Talk Alaska,” an Alaska Common Ground program that addresses public policy topics.

In spite of participants’ comments weighted in favor of the ballot measure, the discussion still provided an airing of multiple points of view.

For instance, when Ken Castner said resource extraction is about taking all of a resource until it is no longer economically feasible, Rep. Paul Seaton, R-Homer, said the driving force behind SB 21 isn’t depleting Alaska oil, but rather offering a “good enough incentive to accelerate development.”

The evening’s facilitator, Bill Hall of Let’s Talk Alaska, guided the discussion around a format that offered three approaches to Ballot Measure 1.

“Instead of two perspectives, we have three, which reflect the complexity of the issue and keeps from getting into debates about one side versus another,” said Hall.

Perspective 1: Legislators Who Voted for SB 21

The provided summary noted SB 21 proponents argued a reduced tax rate on production and sale of the state’s petroleum resources would attract the capital necessary for increasing exploration and development and lead to increased production. That, in turn, would lead to greater employment and income for the state.

Jones questioned why oil production in Alaska is declining.

“It’s a finite resource, not a renewable resource,” said Ken Castner by way of explanation.

“So, does the finite become infinite if we throw money at it?” asked Jones. ‘There’s a feeling out there that (oil companies) are declining their production as a ploy to get the tax incentives.”

After Seaton pointed out that ACES, Alaska’s Clear and Equitable Share, the tax structure prior to SB 21, provided tax credits as incentives to search for new oil and SB 21 “only incentivizes the existing oil or oil that is produced into the pipeline,” Jones had another question.

“Why incentivize a company to do what that company exists to do in the first place? Why do they need extra incentive to make billions of dollars doing what they do?” she said.

Hall jumped in with a reminder that the evening’s dialogue might not offer answers to all the questions, “so write that one down,” he said to Jones.

Applying the trickle-down theory of economics to SB 21’s tax breaks, Ann Dixon said it sounds like the message from the oil companies is “give us the money and good things will trickle down to the rest of you.”

Asked what would happen if Ballot Measure 1 passes and SB 21 is repealed, Seaton said ACES would still be in place.

“But there’s nothing to keep the Legislature, and I’m sure they would, from coming back and reducing the taxes,” he said.

Perspective 2: Legislators Who Voted against SB 21

According to the summary provided, SB 21 opponents pointed to a lack of evidence that ACES was a roadblock to future oil production in Alaska, as well as the lack of anything within SB 21 that required increased development in order for companies to receive reduced taxes.

In Tuesday’s discussion, Sue Mauger said, “The word that sticks out is ‘trust’ and the lack of trust based on our history together, Alaskans and the oil industry. It feels like Alaskans have the Pied Piper of the oil companies in front of us and it only works if we trust them. And I don’t think we have to. They have to earn our trust.”

In response, Haas said two camps exist, one that distrusts the oil companies and government and one consisting of people working in oil-related jobs who have “vote no” signs on their lawns.

“I’m wondering if that distrust can ever be overcome through any sort of rational discussion or are the scars too deep,” said Haas.

Having been in Juneau when SB 21 was being written, Forrest Dunbar, a Democratic candidate for the U.S. House of Representatives, pointed to guarantees such as specific production targets or a sunset provision that would have built elements of trust into the law.

“Those amendments were all shut down,” said Dunbar. “They’re asking people to trust them, but with no guarantee, no mechanism, no verification. I think that contributes to why many of us don’t trust them.”

Seaton agreed. He said when the House was considering SB 21 he had offered a proposal to give incentives for meeting production targets.

“There’s no accountability in the bill,” said Seaton.

When it comes to who benefits from SB 21, Erin Hollowell said it is simply a matter of following the money.

“You can lay all the facts and figures on the table and then look at the bottom at who paid for the study,” she said.

Perspective 3: Referendum Petitioners

The 52,649 Alaskans who signed the petition to put Ballot Measure 1 on the August primary ballot were requesting voters be granted their constitutional right to repeal SB 21. The statement of referendum petitioners Vic Fischer, Bella Hammond and Jim Whitaker says, in part, “The passage of Senate Bill 21 is a defining moment in state history, a moment in which the best interests of the Alaskan people were steamrolled by our own elected representatives in the Legislature.”

Fisher is a former legislator and one of the framers of the state constitution. Hammond is the wife of the late Gov. Jay Hammond. Whitaker served in the Alaska House of Representatives and is the former mayor of the Fairbanks North Star Borough.

Asked by Hall if there is an expectation of citizen responsibility that goes along with the referendum process, Royce Page said, “What I’m doing as an Alaska citizen is saying that people down there in Juneau passed something I didn’t believe in, that I don’t trust and now I get a chance as a citizen to say we need to take another look at it. I’m going to do that and I’m going to encourage everybody, no matter how they look at it, to do that.”

Dave Aplin recalled the unsuccessful effort to restore the Alaska Coastal Management Program. Ballot Measure 2 on the August 2012 ballot lost with 62.09 percent of the voters voting no and 37.91 percent voting yes.

“There was a heroic effort getting petitions across the state and gathering signatures, but once that happened, the amount that rolled out to provide flyers, provide information accurate or otherwise, it was a stomp,” Aplin said of the measure’s defeat. “We’re sort of in that same position again. … The point is how do you avoid being cynical about how this deck is stacked on an initiative like this that calls for a democratic process and our chance to participate in government?”

The People’s Choice: How Will You Decide?

“How are you going to make a choice?” said Hall at the end of Tuesday’s discussion. “Have you had an epiphany that will solve the issue for us?”

For Mauger, even a full financial analysis by someone she trusts won’t resolve the issue of no accountability.

“It’s all just conjecture about how things will play out with no guarantees built into anything,” she said.

Page viewed support of Ballot Measure 1 as an opportunity to make changes.

“We need to look at this, vote yes on the referendum and say we need to redo it, send it back and then be active in our participation with our legislators to say we want some guarantees,” said Page.

Tuesday’s discussion allowed Dunbar to think that “yes” votes might prevail in August, “but it strikes me that Alaska is the little guy in this case. The oil companies are much larger than we are. … I do think we need to start thinking more seriously about diversifying our revenue streams.”

Having discussed SB 21 with those on both sides, Liz Downing said it is clear no one is happy with it.

“It’s not what anyone feels is workable, so that helps me recognize this needs to go back to the drawing board, back to ACES,” said Downing. “I feel more confident in a ‘yes’ vote.”

Summarizing his “behind-the-scenes and below-the-surface” take on SB 21, Seaton said its hidden agenda is not the tax rate, but switching the tax credit incentive away from new companies and back to the big three — ConocoPhillips, BP and Exxon — and giving them control over the North Slope and increasing long-term development costs for new companies.

Bringing it back to the August ballot, Hall asked where Alaskans could find information to help them decide how to vote.

Saying he’s still open to arguments for and against the repeal of SB 21, Haas said the responsibility to provide voters with reasons to vote no on Ballot Measure 1 falls to the oil companies.

Let’s Talk Alaska is a program of Alaska Common Ground, a nonprofit, nonpartisan organization. Original funding for Let’s Talk Alaska was a $5,000 research contract from the Kettering Foundation for the purpose of organizing a public policy institute in Alaska as part of the National Issues Forums Network.

Other topics addressed by Let’s Talk Alaska have been issues related to democracy, Social Security, energy and the Occupy Movement.

In addition to the Homer discussion, eight similar dialogues on Ballot Measure 1 have already been held: one in Seward, one in Fairbanks and six in Anchorage, all of them at libraries. Cordova is next on the schedule.

McKibben Jackinsky can be reached at mckibben.jackinsky@homernews.com.